Daily net cash losses of between 190 and 200 crore as sales slip and customers postpone payment. Prior to the lockdown, the company reported daily cash earnings of 50-60 crore. Executives said that the organization would struggle to pay for daily expenses, half of which go to pay salaries.
In April, sales and production decreased by 26% and 11 percent, respectively , compared to April 2019. Dues from state power companies rose to 16,500 crore by the end of April from approximately 14,000 crore by the end of March.
Before the lockdown, Coal India’s daily cash earnings ranged from 260 crore to 270 crore, including government levies such as taxes, cessation and royalties. It is now hovering between 30 crore and 40 crore a day.
“Following grievances lodged by consumers, the government has also asked subsidiaries to expeditiously release all security deposit refunds under expired fuel supply agreements to ease consumers’ hardship during the current lockdown. Initially, we were planning to stagger this payment to manage our cashflow,” a senior Coal India executive said.
Prior to the lockdown, daily cash costs amounted to approximately 210-220 crores, including salaries, operating input costs and government levies.
Coal generating companies are expected to pay royalties and to cease the quantity of coal produced in a month. While the decline in production decreased output, including levies slightly, the reduction was offset by additional output on account of security deposit refunds within a set timeframe. Expenses are currently running at 220-230 crore daily.
Coal India has reported net profits over the last few years. In the quarter ended December 2019, a total aggregate income of 3,670 crores was recorded.
ET announced on April 27 that subsidiary Bharat Coking Coal had no funds to pay April salaries to its 42,000 employees because it received almost no payment from customers during the month. The debt exceeded 3.200 crore, one of the largest among its subsidiaries.
